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Hugh Pickens writes "In late October, Newsday put its web site behind a pay wall, one of the first non-business newspapers to take the pay wall plunge, so Newsday has been followed with interest in media circles anxious to learn how the NY Times own plans to put up a pay wall may work out. So how successful has Newsday's paywall been? The NY Observer reports that three months into the experiment only 35 people have signed up to pay $5 a week to get unfettered access to newsday.com. Newsday's web site redesign and relaunch reportedly cost about $4 million and the 35 people who've signed up have earned Newsday about $9,000. Still publisher Terry Jimenez is unapologetic. 'That's 35 more than I would have thought it would have been,' said Jimenez to his assembled staff, according to five interviews with Newsday employees. The web project has not been a favorite among Newsday employees who have recently been asked to take a 10 percent pay cut. 'The view of the newsroom is the web site sucks,' says one staffer. 'It's an abomination,' adds another."

Ha! Take that long standing respectable media. Funny, I'd bet they'd be better off without a website at all. Now there is a way to fix this, though I'm interested in feedback before I try to do anything about it. What we need is a micro-payment aggregation service combined with an advertisement blocking proxy server. Opera is doing the rebuilding on the fly for smaller and faster page loads, and if they combined that with an ad-blocking service for $10/yr and had a "$.02" payment button that sites like Newsday could contract for, then everybody would win.

It "worked" for us in that it provided some revenue for Salon to survive through the leanest period of its existence. (We'd already completed the latest of three rounds of layoffs, and the entire staff took pay cuts, three weeks before 9/11.) But within a few months, as advertisers began dipping their toes back in the water and the influx of new subscribers who'd flocked to help us out in a crisis dwindled, we could see that the subscription model didn't provide much room for growth. So we tried something new: we put up an ad over the front door of the site. Subscribers wouldn't see it at all; other readers had to watch a 30-second video ad, then they got a "day pass."

The day pass approach was beloved by the advertisers and hated by many, though not all, readers. More important, by this point the public was, understandably, thoroughly confused about how to get to read Salon content. It took many years for our traffic to begin to grow again. Paywalls are psychological as much as navigational, and it's a lot easier to put them up than to take them down. Once web users get it in their head that your site is "closed" to them, if you ever change your mind and want them to come back, it's extremely difficult to get that word out.

There are many things like this where you can alienate of confuse your customer base so much that you simply doom any chance to rollback to your previous state.

There was a wonderful "dollar" theater around here. It wasn't really all that big but it was well liked and got a fair amount of business. One day for whatever reason, they changed to become a full-fledged cinema. It seems they thought their volume would justify switching.

Well... one-by-one all their customers found out they were charging full-fare and running the latest films. And one-by-one, these folk scratched this theater off their lists. If someone was seeking a dollar theater, this was no longer one of those. If someone wanted to pay full-rate, this theater couldn't hope to compare with the major cineplexes. But when I mean folk nixed it, I mean completely. Everyone just moved on and forgot about it.

They vainly attempted to change back to a dollar theater. But they had no more customer base. Hardly any at all. They closed shop entirely soon after that.

The Internet and Web is a vastly larger marketplace than the neighborhood movie market. It would seem far easier for people to find what you're pushing somewhere else.

From the Guardian article:"...we had a Salon Premium programme that involved gating off a very small amount of content on the site...."

Yeah, well if I am going out to get groceries, and I have a choice of two stores to go to, and I know that one of them is usually out of milk and eggs, guess what? I am not going to go to that one to get everything else on my list, then go to the other one to get the milk and eggs. I will head straight to the store I know has everything I need.

Good observations. When Salon was free I didn't use it much but it was part of the web community. When any site goes pay, it becomes something you access through the internet--in no way is it part of the web.

People have an interest in the web community. The want the sites to thrive and are willing to forgive some adds. Once a site like Salon goes private, they are no longer part of the community. Why would I tolerate a 30 second add to patronize something that isn't even willing to be a part of the com

Lets be fair. Subscribers to the "print" edition also have access to the electronic edition as well as subscribers to the local cable company (I'm sure they get some money generated from that one, too).

And furthermore, it's actually less expensive to buy a Newsday print subscription than it is to get just the electronic access, so the article could really be rephrased as "Thirty-five people pay extra to not get a real newspaper."

Unless they are charging more for their print edition to make up for the online costs and redesign then the print subscribers aren't adding any extra revenue. In short, they don't count. The newsite is effectively reducing their revenue stream and more importantly their traffic and interest. If I'm looking for news sites this is one less site on my list to visit.

That's how I have heard this categorized here in the NY area. See, if you are a Cablevision/Optimum Online sub, you get Newsday Online for free. "That's a $260 Value -- If You Sign Before Midnight Tonight!"

Remember, Newsday is owned by The Dolans, the certifiably insane family that also owns and/or operates Madison Square Garden, the Knicks, the Rangers, the Liberty, Clearview Cinemas, the Beacon Theater, Radio Friggin' Music Hall, and prolly my toaster oven as well, haven't checked lately. This isn't about love or money for the newspaper, this is about things like "synergies" and "paradigms" and "leverage." These are the kind of robber baron sociopaths who would burn an orphanage they own to the ground if the price of diapers got higher than they had budgeted, or they needed to light a lot of their cigars at once and they only had one match left.

The problem is that newpapers are completely dead, the body simply has not stopped moving.

I can get my news HOURS after it has happened or get it from my various RSS feeds seconds to minutes afterwards. Plus I get to filter it to have only what I want.

Short of puppy training, wrapping dishes, and for poop paper for a bird cage, a newspaper has ZERO value. Even web based they are slow to react and usually are only repeating what I have already read from the various feeds I have.

I don't think updating every 15 minutes is needed, but I can see that once a day wouldn't be enough I think.
Funny, it's almost like a full circle. Ebooks and internet delivery systems might bring back the evening edition of newspapers.

I don't think a newspaper has to be entirely irrelevant. There's little news so vital to me that I can't wait a few hours to hear it, one area traditional media could compete is quality. Well-written, thought-out articles with fact checking (remember that?) would be a value proposition that many of the internet sources, with their rush to be first to publish couldn't afford. If you're not going to print for several hours, use that time to make what you print much better than everyone else and I would happily consume your product because I only have to read it once, not read countless rumours, counter-claims, retractions, etc.

Unfortunately this type of quality reporting was dead even before the internet came along. There just wasn't a suitable alternative at the time to eat their lunch, the 'net just happened to be the first one that came along and fit the bill. The internet didn't kill traditional newspapers, they committed suicide a long time ago.

"Unfortunately this type of quality reporting was dead even before the internet came along."
Maybe in the USA (I would not know) but this is not true everywhere. In my country (NL), there are still several newspapers which do all those things you mention. They do not have it easy financially but they do not compromise too much and I think (well I hope) that their base of faithful readers will let them survive. And I do believe that the fast-news-skimming generation will be interested in in depth reporting w

Ha! Take that long standing respectable media. Funny, I'd bet they'd be better off without a website at all.

No kidding. The summary itself tells you that - they spent $4 million and they've earned $9,000 in about three months. By my reckoning with the current expansion rate they can expect to have 1,000 users some time around the year 2017. But 1,000 users is only $60,000 in subscriptions per year, at which rate you're looking at making the investment back in the year 2076.

I'm waiting to see what happens at New Scientist. They are only letting non-subscribers see 7 articles a month -- essentially nil, since it's a weekly magazine. It's really expensive, especially if you don't live in the UK. There's no web-only subscription (I wrote and asked: they recommended the digital version of the magazine but that doesn't seem to come with a subscription to the site...). Now, this is the second time they've tried this. I don't know how long the first one lasted: I went away and came b

Horrible business model aside... it should be noted that anyone with Optimum Online (cablevision's ISP, basically the only cable ISP on Long Island) can access Newsday for free. (Newsday is owned by Cablevision.)
So it's not like 35 people are "subscribed".... 35 people are paying extra for it.

Their business model is not selling web access to the news though. Their business model is selling eyeballs. And they can tell advertisers that everyone who subscribes to the local cable monopoly (which is 75% of the local population) also reads the web site - ergo, lots of eyeballs to sell. That's why this article is so disingenuous - it is implying that the only revenue stream (or the only business model) of Newsday is to sell subscriptions to the web site. When that is in fact not true at all.

Only if their advertisers are dumb. Advertisers will pay only for real traffic, not potential traffic. Advertisers usually pay per click or per impression (ad served). Low traffic = ad revenue death in the online world.

This isn't about paid subscriptions as much as it is about maintaining a regional lock on ISP choice. News12 Long Island and Newsday are both owned by cablevision. If you use cable vision's ISP, optimum online, you have free access to
www.newsday.com [newsday.com]
and
www.news12.com [news12.com]. Optimum customers never hit a pay wall, they are allowed on the site. If you don't use optimum online, you get hit with a pay wall.

A major reason that Newsday has so few subscriptions is that the majority of the people in the region which these new sources cater to don't even know about subscriptions because non-optimum customers are the only ones that hit a pay-wall.

Except for the fact that they revamped their website for about 4 million dollars. So to get 35 paid subscribers from that web redesign and have their traffic fall from 2.2m to 1.5m (per month)... well that may not be epic fail yet, but it is getting close.

Where in the summary does it mention that Optimum Online subscribers get access for free? It, also, does not mention that subscribers to the print version get the online subscription for free (or the one or two other ways that people get free subscription to the online version). Based on the number of people on Long Island who get a free subscription to the online version of Newsday, this tells us nothing about paywalls. From reading the article (which I did on another site before it appeared here), just ab

Does anyone have a before and after screen shot? Honestly, the site [newsday.com] doesn't look half bad. Reduce/condense the amount of information you're throwing on the frontpage and you've got a good site. I don't even see an unnecessarily egregious use of Flash that mars so many news sites. It's a hell of a lot better than 75% of the news sites I come across (even Reuters has this annoying script that runs endlessly). I should note that with my bandwidth here it loaded pretty much instantly. I could see this taking forever on ma and pa's dialup.

It's a terribly designed site. At first glance, you can't tell what are links, and what is just plain text. There are just about zero visual clues as to where you should go, what you should do, or what you should be reading. There seems to be no coherent logic to the layout, either, and the dark background with white text does them no favours. If they paid $4 million for this, they got ripped off.

Compared to what? As the GP said, it's not unattractive and it doesn't consume ridiculous system resources. Plus, it works on Firefox with NoScript on Ubuntu, which is more than a lot of sites can boast.

At first glance, you can't tell what are links, and what is just plain text.

I count a total of 4 lines of plain text on the entire page, excluding the timestamps. Basically if you can see it you can click on it - and if you were wondering whether something was a link or not, mousing-over reveals it. Were you actually confused by this site, or is the complain just a relic of outdated

Backup, servers, and bandwidth are *cheap* compared to manpower. I take it you don't work in the software industry. It's almost always much cheaper to throw more hardware at a problem than it is to redesign an application to increase performance.

Nobody is going to pay for a news site for the most part. You can easily get the same news elsewhere for free. The only places I've seen people pay for something like this is cable TV. The reason for that is because you had too to get all the major content.

The reason you can't do that with websites is that any old Joe can't create a TV station, but they can create a news website. If Newssite1.com makes you pay, everyone will go to Newssite2.com to get the same information free.

Couldn't agree more. There's a hugely worrying trend in the media at the moment to sieze on content generated by the masses. I don't tune into the news or buy a newspaper to hear what xxbLoGgAl_83xx thinks about the war in Iraq, with the highly paid anchor acting as an intermediary relaying her l33t speak to me. If they want to retain my attention they need to add something I can't get by hanging around online - higher production values, better quality reporting, unbiased facts, well thought-out and resear

Nobody is going to pay for a news site for the most part. You can easily get the same news elsewhere for free.

And to continue this point, it's not just the "free" aspect, it's also the ability to go directly to the source for the information.

Back in the day, actually not too long ago, the news outlets (papers, radio, TV) served a purpose - they provided a conduit for information transfer. Folks had information (big game scores, courtroom shenanignas, weather forecasts) and needed a way to convey that information to other folks. Similarly, the "end users" desired the information, but didn't have a way to get it directly. The news media connected the two groups, and served a valuable purpose.

Enter the Intarweb. Suddenly, the end user is directly connected to the information source. The news media middlemen are left holding their hats, scrambling for significance.

Probably the worst thing that has happened to the media outlets is transparency. When you have the web at yor fingertips, it's particularly easy to notice that the vast majority of news outlets are simply re-branding the AP or Reuters news feeds. Their collective credibility is shot to hell. They've been branded as "middle men" and not as information sources. The web allows you to go directly to the source. Why would I tolerate some reporter's re-hash of a story when I can interpret the source for myself? Case and point - I can get weather information directly from the National Weather Service [noaa.gov] rather than getting the dumbed-down version spewed by the local TV station or newspaper. They don't add value (actually they remove it) so I bypass them... because I can.

Personally, I think we are about to enter an entirely new (and unfortunate) age, where newspapers adopt the same model that scientific journals adopt: demand payment from universities and large institutions, deny access to anyone not affiliated with such institutions. Most universities already pay for newspaper subscriptions and I doubt that the governing boards would see such a move as being anything other than "upgrading our newspaper subscriptions for the 21st century." Common people who are not in co

Blogging about technical content only goes so far... How many press releases have we seen from universities that are just vaporous? And how often do we complain that there isn't enough data to make a coherent argument (which doesn't stop Slashdot at all, but that's another story).

If it's scientific or technical journalism, at least a large number of people need to see the real thing. If it's somebody's wardrobe malfunction, not so much.

For the record, they sell access to the web site for $5 per week, while they sell the paper for $4.50 including access to the web site. Basically those 35 subscribers are paying 50 cents per day to not get the paper delivered. They also give free access to all people who subscribe to the local cable provider -- which is a lot of people for the local paper.

For the record, they sell access to the web site for $5 per week, while they sell the paper for $4.50 including access to the web site. Basically those 35 subscribers are paying 50 cents per day to not get the paper delivered. They also give free access to all people who subscribe to the local cable provider -- which is a lot of people for the local paper.

Plus it's Newsday.....

Likely, those 35 people are not on Long Island and can't get it delivered.
I guess the $0.50 is the online delivery charge... all those tubes and all...

For the record, they sell access to the web site for $5 per week, while they sell the paper for $4.50 including access to the web site. Basically those 35 subscribers are paying 50 cents per day to not get the paper delivered. They also give free access to all people who subscribe to the local cable provider -- which is a lot of people for the local paper.

Plus it's Newsday.....

Which lends credence to the idea that the subscribers are just rival newspapers, not real customers.

If you read the article (I know, I know) you'll discover that 75% of the people in the region already have access to the site via package deals:

"Of course, there are a few caveats. Anyone who has a newspaper subscription is allowed free access; anyone who has Optimum Cable, which is owned by the Dolans and Cablevision, also gets it free. Newsday representatives claim that 75 percent of Long Island either has a subscription or Optimum Cable."

So it's actually surprising that 35 people did sign up for it. I'm guessing they are people that moved from Long Island to other places and, for whatever reason, miss reading Newsday. I know it's popular to scream that newspapers are dying, but this is not really a story that supports that supposition.

If you read the article (I know, I know) you'll discover that 75% of the people in the region already have access to the site via package deals. So it's actually surprising that 35 people did sign up for it.

So the potential regional market is only 1/4 the size that it otherwise might have been? Think, without these other access deals, they might have gotten 140 people to sign up.

Face it, with Newsday, NY Times going to the pay to read model and with the rest of News Corp papers doing the same I think this is the direction the rest of the industry is headed. Though I believe a simpler way to pay would be to have an aggregator like Google charge us for the news and distribute the revenues to the individual content providers whenever I click on the feeds. At the same time, if I prefer to go freebie, I would get the same (but lower quality?) news from one of the other sources all group

I read Newsday (paper version) and when you compare it to the other local competition - the NY Post and Daily News - it's a far superior paper. Strong investigative reporting (particularly regarding local government), and celebrity and sports "news" almost never make the front cover.

If Newsday is one of the only for-pay newspapers online and higher profile newspapers like NY Times are still giving their news away for free, is it any surprise that there aren't many subscribers to the for-pay paper? From the sound of it, their pricing scheme was also way too expensive. Five bucks a week? Sounds like they're pricing it as if they still have to send it to the printing presses. Drop the price to 10 bucks a month - max, and maybe make a tiered pricing model, giving away some stuff for free.

Newsday used to be an award winning newspaper. In the 80's there was a very good New York City edition (New York Newsday). They had some truly great writers. The paper actually reported news in the journalistic tradition. Currently, it is owned by Cablevision (following nearly going under thanks in no small part to a circulation/advertising scandal), the size of it's print edition has been shrunk to near comic book size, and while there are still some very talented people writing for the paper, the tone of the paper has really swung to the hard right (as opposed to being somewhat objective). Why anyone would pay for the print edition is beyond me, so I don't know what made them think anyone would pony up for the electronic version. And unless I'm mistaken, current subscribers to "Optimum Online" (Cablevision's Internet offering) can view the Newsday website gratis.

Not to mention its at least 5x the price of a print subscription...... Now granted you get access to past archives, but really, how many people actually need an in-depth contemporary expose on the Monica Lewinsky scandal.

As others have mentioned, the Wall Street Journal makes money even requiring people to pay for online access. So does the Economist. I think the real issue here is the quality of the content.

Read a regular newpaper story in an area where you're an expert. Notice how sloppy they are? How careless with the facts? People have complained about this for ages, but there wasn't much you could do about it. Most communities only had one or two papers to choose from.

Today, though, there's a huge market in online news, and, for the most part, the market seems to have set the price at "free." (That's free as in beer, of course.) It is difficult for me to believe that the market has got the price wrong. (Again, with a few exceptions.)

The Economist doesn't anymore - I'm a subscriber, but I haven't bothered to tell the website that because it doesn't seem to matter. Except recently they've been putting little popup "Become a Subscriber" ads, so I might register just to make those go away.

I don't know anything about Newsday, but I do think there may be a niche for ultra local newspapers; they can give stuff that the big news sources can't - parades, school sports, local government issues, zoning etc. For an example see http://gazette.net/ [gazette.net]

.. but since there are (and the "quality" of news reports is equally low on all of them), then there's really no reason.

Before making a website pay-only, the producer really has to ask: what's the market?, not "what's this service worth? So long as the rest of the market requires no payment, there's not a hope in hell of getting any significant customer base. The only chance you might, possibly, have is to somehow change the market you're in. Going from a news service - of which there are many: all the same, to an analysis or insider site might just do it, but I doubt that many people would recognise the distinction.

As it is, this site has got one very valuable asset that few other websites have: a list of people willing to pay good money for something that everyone else gets for free. That's gotta be worth a fortune.

Effectively, you're saying to ask the question, "Who are my readers, and what are they willing to pay for my content?" Payment includes the price of the item and the cost of delivery.

People in the online world tend to forget that their customers are already paying for the delivery, just to their ISP. They forget to factor that into their fancy equations. Nobody wants to pay a second time for content because it's effectively double-dipping. The internet subscription is payment to access content.

it will be a lot smaller, yes. and some superstar reporters will spin off from newspapers and become their own internet reporting gateways (see nikki finke: http://www.deadline.com/hollywood/ [deadline.com] )

in this way the internet will "atomize" some newspaper reporting where the departments/ individual reporters will report directly to readers, unrelated to any particular newspaper, much like musicians don't need distributors anymore

Newsday's web site redesign and relaunch reportedly cost about $4 million and the 35 people who've signed up have earned Newsday about $9,000. Still publisher Terry Jimenez is unapologetic. 'That's 35 more than I would have thought it would have been,' said Jimenez to his assembled staff

So you expected to be out $4M, but instead you're out $3.991M? Was the point of this exercise to keep the "assembled staff" on board and well-paid through these lean years? If so, incredible charity work. It might have done more help elsewhere, but we can always say that about any charity, so there's no point quibbling.

It's obvious that the current situation is fragile and the media is changing, but what's the solution?

To recap:

Demand for online is on the rise and for print is declining

People don't want to pay

People don't want to see ads

So how can the newspapers provide content and pay for the bills?

It's easy to dismiss the media as being obsolete and that you can find the information for free anyway, but let's consider something: almost all bloggers and "new media" hipsters get the info from the old media anyway. There's precious little actual content created by bloggers and enthusiasts and it's very difficult to do so.

Case in point, I researched for weeks on info about the software used in the making of Avatar [twin-pixels.com] and some technical details [twin-pixels.com]. I got the info by finding the companies involved via IMDB, talking to people involved and basically scrapping bits and pieces into a coherent article. Then Cinefex magazine [cinefex.com] came out with so much more information, all my work looks ridiculous.

Fun fact: Newsday doesn't ask for your credit card when you subscribe. They call you later.

Well, that would exclude me. I never give a credit card number to somebody that calls me. If I don't make the call myself, after dialing a number I've gotten from a reputable source, I don't give financial information.

Its the online paper I read the most due to the wealth of primary material. It sounds like I'll get my opportunity in 2011 when it goes paywall. They will allow 10 free clicks a month, then start charging. I'm only willing to pay $5 a month, but I fear they will charge much more.

I'm being fed information, tailored to an agenda (a.k.a propaganda) and they want me to pay for it? First of all, for example, the BBC News website, has so many grammatical errors it's infuriating and doesn't lend well to trying to squash the racism towards people from India (as it's probably knee jerk reaction to assume ENGLAND could only make such gross errors in ENGLISH that they must be outsourcing their translations/editorial processes... and India is often hand in hand with 'outsourcing'.) On BBC Ne

it must be very hard for the news industry owners to let go of all that profit... but make no mistake, it's gone. whatever they charge, there is always going to be some other source that delivers it for free. the technology to deliver voice, images, and full motion hi-res video instantly, from around the world, is cheap. and, lets face it people that can write an intelligible article or speak eloquently are a dime a dozen.

Journalists have no values these days. Most reporting is full of yellow journalism, scaremongering or reads like a company press release.

I have no time for low grade news stories create by some guy who thinks he'll change the world thanks to his useless degree in journalism which, in my opinion, holds the same value as the free watch I got in Golden Grahams ages ago.

Perhaps it's time to get a second job stacking shelves if writing press releases is not paying the bills.

Man Shot Dead By Saloon
Wild Bill Hickok and those two guys that stole downstairs to save the squarehead kid; tell Ned to stick around so they see what the kid has to say about him. Then he throws down against Hickok and this other cocksucker who draws almost as fast, so it's a toss-up who blew Ned's head off.... To read more subscribe to the Deadwood Version of Newsday

Opinion: On the Existence of Whiskey Some goddamn point a man's due to stop arguing with his-self and feeling twice the goddamn fool he knows he is 'cause he can't be something he tries to be every goddamn day without once getting to dinnertime and fucking it up. I don't want to fight it anymore, understand me reader? And I don't want you pissing in my ear about it. Can you let me go to hell the way I want to?... To read more subscribe to the Deadwood Version of Newsday

Access to the "electronic" version is included with the "dead wood" subscription price. RTA. It enlightening. The "35 subscribers" is kind of misleading. It's more like 90k subscribers when you include paper subscribers and the local cable company.

I think this is an excellent point. You don't need an MBA to understand that the digital version costs less to produce than the physical version, whether we're talking about books, newspapers, audio, or video. If the digital version isn't less than half the cost of the physical one, most people will see it as a rip-off.

Five dollars a week to read a website seems insane to me. I'd have gone with a model that still gave away plenty of free content, but charged a modest fee (30 bucks a year or so) to rea

So what happens if you throw a party and end up with lots more garbage than normal?

Over here where I live, the cost of labour and living is low. So we have various people going around the neighbourhood collecting newspapers, plastic etc to bring to recycling places which pay them money for it. Some collect paper and newspapers, some collect plastic.

They normally pay you a small sum for a stack of old newspapers, not much $$, but enough so that many people keep them for recycling rather than throw them away.

I personally don't see anything wrong with incinerating garbage for energy (the sort that can be incinerated). Especially if some energy would otherwise come from burning coal or oil anyway. This is assuming the incinerators are built so they are less harmful than burning coal or oil.If you're going to burn oil, might as well use the oil to make plastics first, then when you've recycled the plastic too many times that it's not worth being recycled anymore, burn it for energy. This is why I personally think

All well and good, but if they are spending $9mil on a website that is only going to be accessible to people who are ALREADY paying for their articles via the printed paper....what's the point?
They just spent $9mil to allow their current readers to read the same articles online as well. Excellent business model.
They were obviously expecting to make revenue from the paywall, but instead they are proving that the paywall model does not work well. Granted a paper with a larger circulation would have more

There are easier ways of doing this than wasting $4m on a paysite though, surely. If all the readers they care about are on one ISP, just lock out traffic from every other ISP (and maybe send out usernames/passwords if the customers request them so they can still access the site from work, etc). Going to a paid subscription model means a ton of work and regulation and liability around taking payment from people online that they could easily have avoided if they anticipated nobody would even use it.